Highlights
- China’s export controls on rare earth elements, specifically dysprosium, are impacting Foxconn’s AirPods assembly in Telangana, India.
- The supply constraints highlight the fragility of global tech manufacturing and critical material dependencies.
- Apple’s ‘China+1’ strategy faces potential challenges as geopolitical tensions impact rare earth element sourcing.
A Times of India business report highlights a growing bottleneck in global tech manufacturing: China’s rare earth export curbs are reportedly restricting the supply of dysprosium to Foxconn’s Telangana-based facility, which produces Apple AirPods. While the piece offers a glimpse into a very real vulnerability in Apple’s diversification strategy, it also leaves critical questions unanswered—and falls short of contextualizing just how pivotal dysprosium is to the entire electronics and EV value chain.
The Signal in the Static
What’s accurate? China imposed export controls on seven categories of medium and heavy rare earths, including dysprosium and terbium, in April 2025. These elements are indispensable for producing heat-resistant permanent magnets found in miniaturized speakers, drone motors, and EV drivetrains—Apple AirPods included.
Foxconn’s Hyderabad-area plant, which launched AirPods assembly in 2023 as part of Apple’s “China+1” strategy, is reported to be navigating delays in rare earth sourcing, specifically dysprosium. The article outlines a bureaucratic maze involving End User Certificates (EUCs), coordination between the Telangana government, India’s DPIIT, the Chinese embassy, and ultimately, Beijing’s export approval process.
Where It Gets Murky
TOI asserts that “production continues unaffected,” even as it simultaneously reports delays and supply tightness. The article cites Foxconn insiders but doesn’t clarify what volume of dysprosium is at stake, whether this affects AirPods Pro (which use more powerful magnets), or how long existing stock will last. In short, the impact remains speculative.
And while the article references a July 18 industry warning from ICEA (representing Apple and Foxconn), it offers no deeper dive into how this could affect timelines, costs, or alternate sourcing strategies—particularly from the U.S., Australia, or even Myanmar (precarious as that may be).
The Bigger Question Left Unasked
This story is less about one factory and more about the fragility of the rare-earth magnet supply in a bifurcating world. With Trump-era tariffs escalating and China now weaponizing critical material exports, is Apple’s India pivot future-proof—or just geographically dispersed dependence?
Source: Times of India Business Desk (opens in a new tab), “Apple AirPods production in India faces hurdles due to China’s rare earth curbs,” July 22, 2025
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